Understanding Public Agency Participation in ERISA Multiemployer Pension Plans

By Jeff Chang

Many California cities and public agencies negotiate with — and reach memorandums of understanding with —  their union bargaining partners on a regular basis. In some cases, these unions are local police or firefighter unions. In other cases, the bargaining units are part of much larger national unions (e.g., SEIU, the Operating Engineers or the Steelworkers). In these latter situations, the public agency often agrees to “participate” in — and contribute to — the multiemployer pension plan maintained by the national union organization. These plans are typically overseen by a joint employer/employee board of trustees. Most people recognize these arrangements as “Taft-Hartley” plans.

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Have You Been Told Lately That You Owe ESRP?

By Jeff Chang and Allison De Tal

Within the last few days, we have received a number of emails and calls from public agency clients stating that the IRS wrote them to demand an Employer Shared Responsibility Payment amounting to millions of dollars. Naturally, our clients are surprised and shocked that they are receiving such demands – especially since they all believe that they are in compliance with the requirements of the Affordable Care Act.

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Lessons From the Private Sector: Takeaways From Recent ERISA Plan Fiduciary and Fee Litigation

By Jeff Chang

This is a blog about “public” benefits issues — one that focuses heavily, but not exclusively, on California developments. If we are focusing on California’s public agency retirement and welfare plans — which are generally exempt from ERISA — why worry about ERISA litigation? We worry, or at least consider ERISA litigation, because the standards of care established for public retirement plan fiduciaries were clearly patterned after those set forth in ERISA. The ballot arguments for Proposition 21, amending the California Constitution and adopted by voters in 1984, state, among other things:

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Recognizing That All “Rates of Return” Are Not the Same

By Jeff Chang

As a “baby-boomer” and one of the millions of my generation getting ready for retirement, I’ve naturally begun to focus more on the ups and downs of the stock market and all of the “advice” regarding how and when the current bull market will correct itself. Admittedly, I am not an investment advisor and this blog is not about handing out specific investment advice. However, I do feel qualified to share a few basic observations about investing practices and behavior that may be of interest and use to participants managing their own retirement investments or plan fiduciaries responsible for ultimate pension or OPEB obligations.

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If You Don’t Have a Section 218 Agreement, Watch Out for the Social Security “Gotcha”

By Jeff Chang

A section 218 agreement is an agreement between a state (or its local governments and instrumentalities) and the Social Security Administration providing for participation in Social Security and/or Medicare for designated groups of employees. Participation in a state’s section 218 agreement generally is not required. However, once a state, local government or instrumentality signs on to the section 218 agreement, that commitment becomes irrevocable.

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